When I was a kid, there were arcade kings who would play up Gauntlet characters to maximum health and weapons and then sell their games to nearby players for a dollar or two — netting them about $0.02 an hour — but this is a very different proposition indeed.

This is one of the earliest examples of gold farming, or in this case weapon and health farming, that I've ever heard of. In Gauntlet players could get more health one of two ways — either finding in-game items or inserting more quarters. Paying a better player to find items to increase your health could save you money in the long run.

There are also rumors of real-money trade in old text-based MUDs. The first known MUD was created in 1977, so gold farming in MUDs may pre-date Gauntlet.

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Back in the "golden age" of arcades, 1982 or so, many games gave extra lives at fixed point thresholds, such as every 10,000 points. Once you were good enough at the game to only die once every 11,000 points or so, that was enough to set up a positive feedback loop within the game. A good player could accumulate hundreds of lives.

Once fatigue and boredom set in, it was common to sell the ongoing game in progress to a weak player. The good player gets to turn a small profit and essentially play for free, and the weak player gets a great opportunity to practice, at an advanced stage of the game, with all the extra lives at their disposal.

This has been going on long before video games. Pinball games almost always give free games, not just extra lives, for good play. A good pinball player would play for a while, accumulate several free games, then sell them to the next player. This has been going on for decades.